Passionate about IP! Since June 2003 the IPKat has covered copyright, patent, trade mark, info-tech, privacy and confidentiality issues from a mainly UK and European perspective. The team is Eleonora Rosati, Annsley Merelle Ward, Neil J. Wilkof, and Merpel. Nicola Searle is currently on sabbatical. Read, post comments and participate! E-mail the Kats here

The team is joined by GuestKats Mirko Brüß, Rosie Burbidge, Nedim Malovic, Frantzeska Papadopolou, Mathilde Pavis, and Eibhlin Vardy

Thursday, 30 November 2017

Meanwhile, in a room somewhere in Westminster, Kat friend Alex Robinson (Dehns) was observing the latest goings-ons on the Unified Patent Court with respect to the UK's ratification process. With the AmeriKat's whiskers down in a stack of papers, Alex helpfully reported for readers on what happened at yesterday's Delegated Legislation Committee:

"The British political headlines this week may have been dominated by the so-called “Brexit bill”, the Irish border conundrum and the curious case of the 58 Brexit impact assessments that may or may not ever have existed (never mind hard or soft Brexit; the impact assessment row suggests that the Government may have discovered Quantum Brexit). But to those of us with an interest in the UPC, the real political action this week took place not in Brussels or at the despatch box, but in the rather more rarefied surroundings of Committee Room 11 of the House of Commons, where, yesterday, the snappily-named Sixth Delegated Legislation Committee met to discuss the even more snappily-titled Unified Patent Court (Immunities and Privileges) Order 2017. [Do stay awake at the back of the class.]

Delegated Legislation Committee (DLC) debates are normally pretty dull affairs – DLCs have no power to amend a Statutory Instrument put before them, and can only vote on a motion that the Committee has “considered” the SI. However, the UPC Immunities and Privileges Order has acquired disproportionate significance, as it is the final piece of the legislative jigsaw which will allow the British Government to ratify the UPC Agreement. And so on Wednesday afternoon a small but dedicated band of UPC-watchers, including this Kat-for-a-day, headed along to Westminster to watch our lawmakers in action.

Jo Johnson MP, as the minister for IP, proposed the motion, relying on the by-now extremely well-worn refrains about the patent system being fragmented, costly and burdensome, implicitly suggesting that the UPC will solve all of this – a matter on which many have opinions… Mr Johnson did include one interesting statistic: about a quarter of all patents which are litigated in the UK are also litigated elsewhere in Europe between the same parties. If anybody has a source for this please let us know![As we all know, it is rather a leap in logic to assume that all of those parties will want or need a single pan-European judgment, but we shan’t dwell on that here.]

More interesting to this observer were the comments made in reply by Opposition MPs. Jack Dromey MP noted the importance of Britain remaining a “nation of innovation” as it leaves the EU. He recognised the importance of the patent system in this regard. He called the legislation an “eminently sensible move” and stated that “we wholeheartedly support it”. That “we” is intriguing. Does this give us a clue to official Labour Party policy on the UPC? Or was he speaking only on behalf of those in attendance? Answers in the comments, please.

It was not all mutual congratulation though. Angela Eagle MP had some pertinent and uncomfortable questions for the Government about various of the elephants which were also crowded into the room besides MPs, clerks, Kats and other creatures. While calling the UPC a “wholly good thing”, Ms Eagle noted the irony of Britain assisting in bringing it into existence on the one hand while “fragmenting itself” from the EU on the other hand. In this respect she noted the fact that the UPC Agreement is not itself EU law, but that it is closely linked to the Unitary Patent Regulations. She also alluded to expert opinions that the UK would need to take “further steps” to stay in the UPC after Brexit – presumably here referring to the Gordon/Pascoe opinion and others. Ms Eagle further noted the recent developments in Germany and asked whether these would be a help or a hindrance to “getting the timing right” [this observer assumes that she prefers the option of the UPCA entering into force prior to Brexit]. She queried how the UK could remain part of the UPC system without remaining subject to the CJEU’s oversight, and rather pointedly asked Mr Johnson whether his department was prepared for the task of negotiating new agreements regarding the UK’s post-Brexit relationship to the UPC, if it was indeed the Government's intention to remain part of the UPC system.

Relevant though those points were, Ms Eagle unfortunately bundled them all into one rather rambling multi-question intervention which allowed Mr Johnson to respond in broad terms that didn’t shed much light on the Government’s future intentions. He stressed that, while still an EU member, the UK should and will carry out all necessary legislation allowing the Government to ratify the UPCA; he also stated an expectation that “we will need to negotiate with our European partners regarding the future relationship” but stopped short of saying whether or not the Government intended to seek any such relationship. [Only a cynic would suggest that the Government hasn’t thought about this yet.]

Mr Dromey noted that his support for the legislation was on the basis that there would be an “enduring mechanism” after Brexit and said that British exclusion from the UPC would be a source of “immense concern”. Mr Johnson’s words in reply were extremely carefully chosen – he simply noted that the Government wanted to put itself “in a position to enable the UPC to come into existence” and “continue to play a facilitating role in setting it up” but that the future relationship would be “subject to negotiation”. The CJEU issue was not mentioned at all.

After another intervention from Ms Eagle on similar lines as before, the Chair (Adrian Bailey MP) cut the debate short, noting that the discussion was supposed to be confined to the substance of the SI, and put the motion to a vote. The motion was carried unanimously, Mr Dromey’s “immense concern” notwithstanding.

So, what are we to make of all this?

First, and in practical terms: the DLC’s consideration of the SI means that all that remains in the Commons is a formality. A motion will be put before the House on behalf of Mr Johnson’s older brother, the Foreign Secretary, “That the draft Unified Patent Court (Immunities and Privileges) Order 2017, which was laid before this House on 26 June, be approved”. Indeed, such a motion has already been listed in the House of Commons’ Order of Business, although no date has yet been assigned. According to this helpful briefing paper, no debate will take place (the debate having been delegated to the DLC) and so the House can only approve or reject the SI. The last time an SI was rejected by the House of Commons was in 1978 and so it seems that approval is essentially a foregone conclusion.

The House of Lords must also give its approval to the SI in a similar fashion. The corresponding Grand Committee discussion in the House of Lords has been scheduled for 6 December.

If both the Commons and the Lords give their approval swiftly, there now seems to be a realistic possibility that the UK will be in a position to ratify the UPC Agreement before the year is out, or early in 2018 if the Commons and Lords votes cannot be scheduled in the remaining time before the Christmas recess.

Second, there is the rather more Rumsfeldian question of the “known unknowns”, chief among which is what Mr Johnson meant by wording such as “we want to put ourselves in a position” to enable the UPC to come into force, or “continue to play a facilitating role” or “work to bring it into operation”. The Eagle-eyed [pun fully intended]will notice that he has stopped short of saying that we will actually ratify the Agreement. Coupled with his acknowledgement that the future relationship will be a “matter for negotiation” does this give us a hint that the Government might withhold formal ratification as a bargaining chip subject to discussion of the future relationship (not unlike its, erm, wildly successful approach to negotiations over the Brexit bill, Irish border and future trade agreements)? Or is this GuestKat engaging in the type of meticulous verbal analysis against which Catnic warned us? Assuming that the official transcript in Hansard confirms this report, it’s possible to parse Mr Johnson’s words either as fulsome support for ratification or as a rather more noncommittal position. Truly, it seems, actions will speak louder than words over the next few months.

Another set of “known unknowns” is the Labour Party’s policy on the UPC. Mr Dromey’s comments seem to hint at Labour support for the UPC, and, indeed, support for continued UK membership after March 2019. But was he speaking on behalf of the party, or merely expressing a personal view? Enthusiasm for the UPC does not seem to sit comfortably with the party’s apparent commitment to leaving the single market and customs union, or the somewhat ambivalent stance of the current party leadership towards business.

Overall, then – progress has indisputably been made towards UK ratification, but whether the UK will actually ratify the Agreement, and what (if anything) it might seek in post-Brexit arrangements, remain as unclear as before. Of course, if the Bundesverfassungsgericht fails to issue a final judgment before 2019 or 2020 in the German constitutional case, this could all turn out to be rather academic. It will be most interesting to see what – if anything – emerges from Karlsruhe after the deadline for third-party submissions elapses on 31 December."

You can watch the proceedings here. The transcript in Hansard should be available sometime today.

14 comments:

Anonymous
said...

The GuestKat's meticulous verbal analysis is entirely justified in these circumstances - I am quite sure that Jo Johnson's stopping short of saying that the UK will actually ratify the Agreement was quite deliberate (and/or an implicit acknowledgment that if we do we may nevertheless have to leave again as soon as Brexit takes effect).

Reading Hansard, it seems that that Jo Johnson used certain phrases repeatedly. This is unlikely to be an accident. More likely, those phrases were drummed into him beforehand so that he could stay "on message".

One of JJ's most repeated phrases was that the government wanted to be "in a position to ratify the agreement". If this repetition is indeed the result of JJ effectively reading from a pre-agreed script, then it is not hard to reach the conclusion that the UK may not rush to deposit its instrument of ratification.

In connection with the UK's future participation in the UPC, other phrases often repeated (in a number of variations) could well be significant too. These include "we will need to negotiate" and "It would not be appropriate for me to set out unilaterally what the UK’s position will be in advance of those negotiations".

So, to conclude: whilst reaffirming that it thinks that the UPC is a good idea, the UK government has promised neither swift ratification nor a guarantee of the UK's continued participation in the UPC... as everything seems to depend upon the outcome of negotiations with the EU.

As we all know, the UK has stated its intention to leave both the single market and the customs union, and to ditch all Treaties that underpin EU law, including TEU, TFEU and EURATOM. How on earth the UK can do this and continue participating in the UPC is anyone's guess. Indeed, one could be forgiven for gaining the impression that the government is desperately trying to keep all plates spinning for the time being whilst knowing full well that it will be impossible to keep this up indefinitely.

This all means that, instead of asking when the UK will ratify, we ought instead to be asking which of the plates currently spinning will the government allow to come crashing down: the UK's position on the single market (and the role of the CJEU) or the UK's position on post-Brexit participation in the UPC?

Whilst I do not know the answer to that question, I most certainly would not like to put money on the UK's continued participation in the UPC. And this perhaps raises the most pertinent question of all: even if it were able to ratify the UPC in 2018, do we really believe that the German government will do so without knowing whether chaos will reign less than a year later as a result of the UK's enforced departure from the system?

Wearily, I suppose this JJ wordplay is all of a piece with the notion that negotiating with EU 27 is all about having in your hand more "cards" to play that the Team on the other side of the negotiating table.

Presumably, the view amongst HMG's ministers is that one of Macron/Merkel's highest priorities is to get the UPC up and running, and further, that EU27 ready to pay a high price for UK ratification.

When JJ is talking about negotiations re post Brexit stay of the UK in the UPC, it clearly means that all those claiming that the stay is easy to obtain (K. Mooney, W. Pors and consorts) have been ridden by an illness called "wishful thinking".

It is understandable that they see big profits flowing away, so that self illusion is an attempt to overcome the loss. The more so since they have invested a lot of time and efforts in devising the RoP of the UPC.

It would be better if they would come back to reality rather than trying to pull wool over our eyes!

I'm astounded that people still believe that a member of the Government giving vague and non-committal answers to questions put to them indicates that the Government have some sort of plan as to the future of the relevant policy. Surely, this just indicates that the Government have no plans in relation to the relevant policy.

It has become abundantly clear over the last few weeks that the Government have little or no plan for any major policy area. See for example, the 58 reports on the economic impact of Brexit that don't actually exist or the non-existent plans for the Irish border. With regards to the UPC, JJ is not committing to the UK participating in the UPC as the the Government simply do not know whether we are able to after Brexit or whether we will be allowed to. There simply isn't a Government plan as to what will happen post-Brexit with the UPC. JJ's answers aren't a negotiating tactic as the Government doesn't have any negotiating tactics, particularly in relation to something as of little relative importance as the UPC.

Whilst people reading this blog are heavily interested and invested in the UPC it is a mistake to think the Government are equally as interested. The UPC is barely a blip on the Government's radar and almost certainly isn't something that would be considered a bargaining chip. Non-committal answers simply show a lack of knowledge.

So the UK continues with the process towards ratification and is criticised here for playing politics with the EU, whereas Germany is rightfully waiting for the UK's mess to be cleaned up. sad.

Fact is, continued participation does require renegotiation.Fact is, the UPC is not a bargaining chip, because its value is insignificant.Fact is, facts won't stop anti-UK criticism from both within and without the UK at every turn.

To sum it up: post Brexit stay of the UK in the UPC is a fata morgona, only held alive by those having a (big financial) finger in the pie.

I like the barely blip!

All the corresponding waffling coming from this side should stop. It is getting tiring.

There is also an interesting point raised in JJ's plea before the committee:

"The judges and staff of the court will be exempt from national taxation on their salaries and from national insurance once the court applies its own equivalent tax and puts in place its own social security and health system, but neither exemption will apply to court staff who are British nationals or permanent UK residents."

One of the reasons for not directly taxing salaries of staff of international organisations is to avoid the situation of a different salary for staff of different nationalities and/or working in different places of employment. This applies whether the staff is a citizen of the country in which he works or not.

JJ is thus implying that UK nationals and permanent UK residents will see their UPC salary taxed by HMG. Has anybody realised what an incongruity that is? It is another proof, if one needed one, that HMG is not prepared at all.

There is also an interesting point raised in JJ's plea before the committee ...

And this in my opinion leads on to the even more interesting question as to what form of employment law will apply to the staff of the UPC.

The UPC will have its own staff regulations but has it been clarified what court or tribunal then has competence in the case of disputes concerning the application of these regulations.

Please don't say that EU law applies here and that the EU Court has jurisdiction.The UPC like the EPO is not an EU institution.If it would be an EU institution then surely it wouldn't need to have its own Protocol on Privileges and Immunities because the EU PPI would apply.

So can anyone solve the riddle: To what court or tribunal will UPC staff be able to apply for judicial review in the case of employment disputes ?

To the question of whether a judge can be independent if there is no reliable judicial review available to him against adverse decisions of his appointing authority, the German Constitutional Court will hopefully give a response.

In all likelihood it will be the administrative tribunal of the international labour organisation -ILOAT- in Geneva.

It is a well known fact that this "court" is by no means up to the expectations, as it only looks whether the letter of the law and the procedure have been respected. There should be internal mechanisms in the UPC administrative system to look at complaints from staff internally before a member of staff can complain at the ILOAT. The ILOAT does not have the capacity to deal with direct complaints

But before this is possible, staff regulations for the employees of the UPC will have to be decided. Nothing has apparently be published on this topic.

As national judges could be seconded to the UPC, they could de facto remain in their national statute. As it is intended that at least at the beginning the work at the UPC is only part-time, such a situation would not be uncommon. What then about their independence?

The more one looks into the UPC, the more one discovers problems. May be this was a reason to push it through as quickly as possible, so that the problems could be hidden. Once discovered, it would be too late to go back. In one of the official languages of the EPO it is called "fait accompli". But no doubt it is understandable in lots of languages.

To the question of whether a judge can be independent if there is no reliable judicial review available to him against adverse decisions of his appointing authority, the German Constitutional Court will hopefully give a response.

IPKat Policies

This page summarises the IPKat policies on guest submissions and comments. If you have posted a comment to one of our blogposts and it hasn't appeared, it may be because it doesn't match our criteria for moderation. To learn more about our guest submissions, comments and complaints policy and the procedure for lodging a complaint click here.

Has the Kat got your tongue?

Just click the magic box below and get this page translated into a bewildering selection of languages!